How does BitMEX calculate margin calls?

3 answers

• Apr 04, 2022 · 3 years ago
  Sure! When it comes to margin calls on BitMEX, it's all about maintaining the required margin level. BitMEX uses a sophisticated algorithm to calculate the margin level of each position. If the margin level falls below the maintenance margin level, a margin call is triggered. This means that the trader must either add more funds to their account or close some of their positions to increase the margin level. It's important to note that margin calls can happen quickly, especially during periods of high volatility. So it's crucial for traders to closely monitor their positions and ensure they have enough margin to avoid liquidation.
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• Apr 04, 2022 · 3 years ago
  Margin calls on BitMEX are determined by the Mark Price. The Mark Price is an index price calculated by taking the weighted average of prices on multiple exchanges. When the Mark Price of a position falls below the liquidation price, a margin call is triggered. The liquidation price is the price at which the position will be automatically closed to prevent further losses. It's worth noting that BitMEX has a system called the Auto-Deleveraging (ADL) system, which helps to prevent socialized losses by closing positions of traders who have the highest leverage and are most likely to cause liquidations.
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• Apr 04, 2022 · 3 years ago
  BitMEX calculates margin calls based on the Fair Price Marking (FPM) system. The FPM system uses a combination of the Last Price, the Index Price, and the Funding Rate to calculate the mark price of a contract. When the mark price of a position falls below the liquidation price, a margin call is triggered. BitMEX's margin call process is designed to ensure the integrity of the platform and protect traders from excessive losses. It's important for traders to understand how margin calls work and to manage their positions accordingly to avoid liquidation.
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